Finance and Oil. Is There a Resource Curse in Financial Development?

T.H.L. Beck

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This paper shows that the finance and growth relationship is as important in resource-based economies as in other economies. This paper also documents less developed financial systems in resource-based economies and banks that are more liquid, better capitalized and more profitable, but give fewer loans to firms. Firms in resource-based economies use less external finance and a smaller share of them uses bank loans, although there is the same level of demand as in other countries, thus pointing to supply constraints. Overall, there is some indication of a natural resource curse in financial development, which falls more on enterprises than on households. This calls for intensified efforts in resource-based economies to deepen and broaden financial systems.
Original languageEnglish
Place of PublicationTilburg
Publication statusPublished - 2011

Publication series

NameEBC Discussion Paper


  • Financial Development
  • Natural Resource Curse. JEL Classifications


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